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What Does the Internet of Things Mean to Distributors?

By Carolyn Heinze

Analysis firm Accenture believes that by 2030, the Internet of Things (IoT) will be contributing $14.2 trillion to the global economy. But what does this really mean?

Right now, much of the hype surrounding IoT focuses on the consumer, with smart-home systems such as Nest, and an array of other products either in existence, in development, or projected to be in development, that do things like enable your trash bin to update your grocery list (Did you just throw away a milk carton? Don’t worry—that device stashed in your garbage can just made a note that you need to restock). While there are those of us who question how much we really need or want this stuff in our lives, there is an argument for the positive impact that IoT can have on business. Which brings us to yet another tech acronym: IIoT, or the Industrial Internet of Things.

For distributors, IIoT has the potential to affect what they sell, as well as their own internal operations. Bob O’Donnell, founder and chief analyst at Technalysis Research LLC in Foster City, Calif., notes that fleet management and shipping and receiving could benefit from IIoT, especially when it comes to tracking trucks, palettes, and shipping containers. Oil and gas monitoring systems equipped with IIoT functionality could streamline troubleshooting in the supply chain. And, along the same lines as Nest, IIoT stands to play a lead role in smart buildings, with automated—and connected—systems, such as HVAC. And back at the warehouse, IIoT may help to streamline functions like inventory.

But O’Donnell argues that most IoT (or IIoT) devices will only be effective if they’re simple, and actually useful. “There’s this over-glorification of all the things you’re going to be able to do,” he said. “Just because it’s connected doesn’t mean it’s good, and just because it spits out data doesn’t mean it’s good. Is it actually helping?” As it stands, he adds, people involved in big data projects often discover that there wasn’t much to discover in the first place: The big data reveals very little, or information that was already known.

There’s also the issue of protocols—there are a number of them out there, with Google recently announcing yet another one, Brillo. “There are no dominant players yet, and because there are no dominant players, everybody wants to become a dominant player,” O’Donnell said. This creates confusion, and a lot of inconsistency in the nitty-gritty integration of these systems. “It’s very complicated because different things work at different levels. What layer [of the network stack] does this protocol work on versus that? And can these two things coexist, or does this mean that if I have this standard I can’t work with this standard? It’s very, very messy.” Not to mention the security issues surrounding network connectivity—something that O’Donnell doesn’t believe has been adequately addressed yet.

Still, there’s little argument that IoT and IIoT is on its way into the enterprise. So how should distributors vet IIoT products? “If it takes somebody more than a minute, or half a minute, to describe what the product is capable of doing, then they might want to think twice,” O’Donnell said, “because I think with IoT stuff, simplicity is going to trump everything else.”

Heinze is a freelance writer and editor. She can be reached at carolynheinze@free.fr.

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